Brokerages set to see greater profits

With new listings being announced everyday, this is the time for brokerages and the UAE can expect to see its stock markets rise to pre-crash levels, experts say. An influx of foreign capital is expected to lift volumes on the UAE’s stock markets to pre-financial crisis levels and help brokerages earn record revenues, The National reported.
“Frankly, 2014 is the best year for brokerage companies since 2008 in terms of revenues,” says Mohammed Ali Yasin, the managing director at NBAD’s brokerage arm. “If traded volume continues it will be the highest on record, and that’s why we see brokerages either opening or expanding their business.”
Emaar Properties spun off its malls unit in an initial public offering on Thursday. It raised US$1.6 billion from the share sale, with the shares priced at Dh2.9, the top of the pricing range in a book-built IPO, the company said. It gained 12% on its first day of trading. Emaar also has plans to spin off its hospitality business “in the next few months”, said its chairman, Mohamed Alabbar. Other companies are also slated to go public in the near future – the property developer Damac and the private equity house Gulf Capital.
The hype over the public offerings slowed traded volumes last month, with investors subscribing to the Emaar Malls Group IPO, but brokers expect that the company will bring in plentiful trade now that is has listed.
“Markets should pick up in the coming quarter,” said Nabil Farhat, a partner at Al Fajer Securities, which trades stocks on the Abu Dhabi Securities Exchange and Dubai Financial Market. “There’s also a new addition, Emaar Malls Group, which will be the latest product to trade. It’s positive for our industry.”